Oil and Gold Models workshop – Bangkok, 14 November 2011

The workshop focused on building models for oil and gold and also reviewed some of the associated risk limits with an emphasis on Pre-Settlement, Stop Loss, Transaction and Expectation driven limits. We reviewed price, volatility and relative value models and also took a look at fundamental drivers of pricing for Gold and Oil.

Welcome to the resource page for attendees of the Wealth Management’s Oil and Gold workshop conducted at the Landmark hotel in Bangkok, Thailand on 14th November 2011 for its clients, partners and well wishers.

The workshop focused on building models for oil and gold and also reviewed some of the associated risk limits with an emphasis on Pre-Settlement, Stop Loss, Transaction and Expectation driven limits. We reviewed price, volatility and relative value models and also took a look at fundamental drivers of pricing for Gold and Oil.

The workshop finished with a Golden lucky draw for gold and a copy of Risk Applications and Frameworks.

Here is a link to the downloadable pdf edition of oil and gold models pricing workshop with and without the onsite doodling.

In the following posts we concentrate on two commodities, crude oil and gold, and discuss various methods of modeling their prices. We estimate the possible direction prices will move in response to certain market drivers. We consider the impact of the interrelationships between commodity pairs and between the commodity and other risk classes, such as currency pairs and the impact of a break-down in these relationships under times of stress. We look at market fundamentals, demand for and supply of the commodities, reducing/ increasing spreads between different blends in the case of crude oil, growth of commodity stockpiles, market growth trends in the developed and developing world, etc and how these factors could impact the results of our models.

Aside from the real life examples used in the courses and posts mentioned above, we also provide a crude oil specific case study that covers a risk management framework for managing inventory and margin losses of a petrochemical firm. A Value at Risk based approach is utilized to determine acceptable levels of risk for the firm which is then used in devising a plan for the implementation and management of an appropriate control structure.

It is also covered in session III of the video course “Cross Selling Treasury Products Training Video” mentioned earlier.

FinanceTrainingCourse.com also runs a subscription based site for customers that provides all available html, pdf and video course content for a fixed annual or quarterly charge to individual customers. An enterprise license for the same e-learning resource is also available for corporate and institutional customers.

Here is an outline of one of the many video courses available on the enterprise site

What material does the commodities course cover?

For sale video course

Price volatility in crude oil, gold, silver, cotton, sugarcane, wheat and cereals has created an unprecedented opportunity for corporate relationship managers to cross sell treasury products to their institutional, trading, manufacturing and high net worth customers. In our video course we present a framework for empowering client facing treasury teams to go out and cross sell high value, high margin trading concepts to clients by educating customers about their exposures and some of the solutions available to reduce the risk associated with the same exposures.